- Should Medicare cover $100,000 drugs?
- What does $1 buy?
- Apps for diabetics.
- Freezing wages.
- Industry mergers and health reform.
- Obamacare: where are we?
You are currently browsing the monthly archive for November 2010.
Tags: Links
To evaluate providers based on the health outcomes or the cost of care, one must attempt to evaluate dimensions of care which are strictly within the providers control. For instance, if a physicians treats two patients with breast cancer, but one patient has a more advanced form of breast cancer, one should take this difference into account. Patient comorbidities also affect the prognosis for a successful recovery from illness, as well.
One method to take into account the patient’s health conditions upon presentation at a provider’s facility is to use risk adjustment methods. Risk adjustment methods take into account factors such as patient demographics (e.g., age, gender), health status (e.g., prior diagnosis, current illness severity), prior utilizations (e.g., previous hospitalizations) and other factors to predict the expected outcome for a typical patient. Risk adjustment, however, is never perfect. A paper by Garber, MaCurdy and McClellen (1998) review some of the problems with using risk adjustment in the health care setting.
Tags: Risk Adjustment
Do Medicare beneficiaries in fee-for-service plans access better physicians than those in Medicare Managed Care (MMC) plans? Huesch (2010) attempts to answer this question for beneficiary access to quality cardiologists. Using data on heart patients without AMI in Florida, the authors observes the following results:
“No evidence was found that Medicare payor type significantly influenced the likelihood of using physicians with different admission length profiles. Instead, MMC subscribers had significantly worse odds of seeing those physicians with favorable outcome profiles.”
To control for within-hospital omitted variables such as hospital discharge policies and staffing levels, the author conducted a within hospital analysis to arrive at this conclusion. In addition, all outcome measures are risk adjusted for patient health. Does this finding imply that MMC beneficiaries receive worse care than Medicare FFS beneficiaries? Maybe not.
“..this study’s findings are largely consistent with unobservable adverse MMC member health status leading to marginally worse outcomes. Put differently, observed outcome differences may just be a proxy for unobserved health status or illness severity. Nonuniform concentration of MMC patients among particular physicians then ensures that a typical MMC patient will see a physician whose profiles have become slightly worse over time than his or her peers in the same hospital. ”
Determining whether patient outcomes are due to physician performance or unobserved differences in baseline patient health is the key to having valid measures.
- Huesch, M. D. (2010), Managing Care? Medicare Managed Care and Patient Use of Cardiologists. Health Services Research, 45: 329–354. doi: 10.1111/j.1475-6773.2009.01070.x
In October 1789, President George Washington declared his support for a day of “public thanksgiving and prayer to be observed by acknowledging with grateful hearts the many signal favors of Almighty God.”
Today, Thanksgiving is a time to give thanks for the many blessings you have in your life. In a time where cholera has killed over 1500 Haitians, where almost one in four adults in Botswana has HIV, and where 3 million residents of India have tuberculosis, you should take a few minutes to appreciate the health that you and your family hopefully enjoy.
In fact, the surgeon general now recommends that families take a minute to talk about their health history during the Thanksgiving feast. True, Thanksgiving is one of the times where families congregate, but will families put down the turkey and stop watching football to talk about each person’s health history? I am doubtful, but discussing family health history is an important goal.
In addition, I would like to thank all of you who read my blog. Your comments and feedback have been invaluable. I wish you all a happy and healthy Thanksgiving.
Tags: Thanksgiving
- Do sick people choose safer investments?
- Lowering copayments improves adherence.
- Buffet: Pretty Good for Government Work.
- The Pope’s turnaround on condoms.
- Food as medicine.
Tags: Links
From the Commonwealth Fund:
“The analysis says people have many plans to choose from but that enrollment is concentrated in a handful. It notes, for example, that the average Medicare beneficiary in 2010 has 33 plans from which to choose. But in 14 states and the District of Columbia, a single company (not the same one in each state) accounts for more than half of all Medicare Advantage enrollment.
And in 27 states and the District, three companies account for 75 percent of more enrollees.”
The question is whether ex-ante competition (beneficiaries having a large number of options) or ex-post competition (the market for Medicare Advantage being less concentrated) is important. If the non-selected plans are good substitutes for the plans with a large market share, then the lack of ex-post competition is not a problem. Likely, large plans have more market power to negotiate lower rates with physicians (which is a good thing for consumers). If the large plans started charging higher premiums, beneficiaries may switch to another option which currently has lower market share. Thus, ex-post market concentration does not necessarily indicate a lack of competition.
Tags: Competition, Medicare Advantage
From what areas does a hospital draw on to fill its beds? There have been many attempts to define a hospital’s catchment area. The Dartmouth Atlas Group uses hospital referral regions (HRRs) and hospital service areas (HSAs). One method is to determine a minimum admission rate for a given geographic unit (e.g., county, census tract, zip code). For instance, a given zip code would be placed in a hospital’s catchment area if that zip code made up at least 0.5% of hospital admissions. Conversely, one could include all areas where at least a certain percent of resident admissions were to the hospital in question.
A paper by Gilmour (2010) examines how to create a hospital catchment area using K-means clustering. The goal of this process is to assign local authority districts to hospitals based on the how likely the individuals are to visit a certain hospital. K-means clustering is used to partition n observations into k clusters in which each observation belongs to the cluster with the nearest mean. The author applies the standard K-means clustering algorithm as follows:
- Two cluster centers are chosen arbitrarily,
- Each observation is assigned into the cluster whose center it lies closest to,
- The center of the cluster formed by this assignment is recalculated, and
- The process is repeated until the cluster assignments cease to change.
Gilmour uses a multivariate approach to estimate “closeness.” He uses principal components analysis to incorporate additional information such as the size and distribution of the hospital’s activity.
Although the K-means clustering captures a larger share of the hospital’s admissions, the catchment areas are generally much larger than is the case using the marginal methods.
- Stuart John Gilmour (2010), Identification of Hospital Catchment Areas Using Clustering: An Example from the NHS. Health Services Research, 45: 497–513. doi: 10.1111/j.1475-6773.2009.01069.x
Tags: Hospitals, labor markets
The cover of The Economist this week looked at America’s budget deficit. According to their estimates, “America’s budget deficit in the fiscal year that ended on September 30th stood at $1.3 trillion; at 9% of GDP, the second-largest since the second world war.” The short run cause of this deficit is the recent severe recession, the wars in Iraq and Afghanistan, and the stimulus spending. In the long run, however, entitlements will further destabilize the country’s fiscal soundness. Entitlements such as Social Security, Medicare and Medicaid “…will double the federal debt by 2027; and the number keeps on rising after then.”
Nevertheless, the prospects for Japan look even bleaker. While the U.S. debt has exceeded 50% of GDP, Japan’s debt is near 200% of GDP. Further, Japan is aging quickly; the median age in Japan is 44.6. Although a long life expectancy is a good thing, it will be difficult to support so many older workers without a concurrent rise in the number of workers. Since the birth rate in Japan is so low (2nd lowest in the world), fewer and fewer youth are entering the job market. More immigration could help, but it is currently difficult for non-Japanese immigrants to gain citizenship even after working in Japan for many decades.
More from the Economist:
An article on Slate wonders “Does the TSA Ever Catch Terrorists?” An excerpt:
“The aforementioned “behavioral detection program,” also known as SPOT (Screening of Passengers by Observational Techniques), has been one of the TSA’s most roundly criticized initiatives. In May, the Government Accountability Office released a report noting that SPOT’s annual cost is more than $200 million and that as of March 2010 some 3,000 behavior detection officers were deployed at 161 airports but had not apprehended a single terrorist.”
Now, I admit, that I am not an expert in anti-terrorist tactics. TSA activities, however, should not be evaluated solely on the number of terrorists they catch. As the article mentions at the end, TSA screening would be very useful if it could prevent terrorists from entering the airport.
Consider the following equation:
- Sucesful Attacks=P(Attempt)[1-P(Caught|Attempt)]
The TSA can reduce the number of terrorist attacks either by increasing the probability someone who attempts a terrorist activity is caught, or reducing the probability of terrorist attempt. The Slate article basically assumes that if the number of terrorist attempts is held constant over time and no one has been caught, then P(Caught|Attempt) is 0. This certainly would represent one type of failure. However, if the TSA can reduce the number of terrorist attempts near 0, then the TSA could feasibly be very efficient.
[Even if at least 16 individuals later accused of involvement in terrorist plots flew 23 different times through U.S. airports since 2004, but TSA behavior-detection officers didn't sniff out any of them.]
Tags: TSA
The Drunkard’s Walk
November 26, 2010 in Books | 1 comment
The Drunkard’s Walk is not about drinking. Instead, as the subtitle states, the book discusses ‘How Randomness Rules our Lives.’ Although I personally didn’t enjoy this book, I highly recommend it to most people.
There are two categories of people who should not read this book: economists (me) statisticians, or mathematicians. These people will likely already know most of the fundamental concepts which are outlined (in a very entertaining manner) in this book. In addition, you should not read the book if you’ve read the History of Statistics (me). The Drunkard’s Walk has a lot of neat anecdotes about the lives of statisticians and what problems they were trying to overcome wen they developed new statistical methods. These anecdotes, however, are more thoroughly documented in the much denser, much slower, but also much more informative History of Statistics.
To see if you should read this book, check out the following excerpts below:
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